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The Week Observed: January 22, 2016

By Daniel Hertz

22.1.2016

What City Observatory did this week

1. Which federal agency has a big role to play in housing affordability? The answer might surprise you. The Federal Reserve has announced a plan to increase the interest rates it charges banks, putting the brakes on the economy in an attempt to hold back inflation. But it turns out that if you subtract housing, the Consumer Price Index is actually going down. People worried about inflation, then, should really be worried about the price of housing. Fortunately, the Fed could conceivably do something about that: by targeting its purchases of securities to construction loans and mortgages in multifamily housing, it could keep down interest rates in the housing sector and encourage more supply, helping to hold down the growth of rents.

2. For highway advocates, it’s about the journey, not the destination. Our earlier piece about the folly that was the expansion of the Katy Freeway in Houston got some pushback: If the government widened road, and congestion is even worse than before, doesn’t that mean that the road is really popular, and the project was a success? In short: no. When drivers don’t see the costs of their decision to drive—in the form of pollution, more deaths and injuries from crashes, more inefficient land use, and the extra congestion they impose on everyone else—more highways just mean more driving, and more costs. Moreover, if congestion is both a reason for expanding highways and a sign that such an expansion has been a success, then there will be no end to the highway-building—which is maybe the point.

3. Are jobs really returning to the city? We’ve long argued that the economic center of gravity of US metropolitan areas is shifting towards urban cores. Jed Kolko, formerly of Trulia, takes issue with that conclusion, however, and argues that the evidence for such a shift is much more ambiguous. We lay out exactly why we disagree: The shift appears to transcend economic cycles, is picking up steam in the most recent data, and the data that appears ambiguous to Kolko is based on county-level numbers that include both urban cores and far-away suburbs—a good reason for ambiguity if the goal is to understand how job growth is different in those two types of built environments.

4. Why not make housing assistance to the low-income as easy as assistance to the high-income? Recently, we argued that if we’re serious about addressing affordability, Housing Choice Vouchers could be made universal, available to everyone whose income qualifies them—as opposed to the current situation, in which limited funding means roughly three out of four people who qualify don’t get assistance. But there are problems with that plan, including the fact that in many places, finding landlords who accept vouchers can be difficult. So here’s another idea: A refundable housing tax credit. That both avoids the problem of landlord compliance, and helps model low-income subsidies on the things that make high-income subsidies—like the mortgage interest tax deduction—so popular: they’re easy, automatic, and universal.

The week’s must reads

1. Streetsblog NYC‘s Charles Komanoff savages a New York City report on the traffic impacts of new for-hire vehicles, like Uber or Lyft. As Streetsblog points out, the study isn’t actually based on the copious data available on such services, as well as regular taxis; instead, it’s based on interpolating “hypothetical 2010 and 2020 traffic estimates.” Those estimates conflict with other estimates made by outlets like the New York Times. And even the presentation of data seems designed to be opaque, as evidenced in the chart that Streetsblog highlighted below.

3. On the heels of our stories about Houston’s Katy Freeway, US PIRG has released a study on the worst “highway boondoggles”: huge and expensive infrastructure projects that failed to succeed even on their own terms, reducing traffic congestion. In addition to the Katy, US PIRG’s list includes I-405 in LA, which was expanded at a cost of over $1 billion without reducing travel times, and US 101 in Silicon Valley. They cover well-established research about induced demand and the futility of fighting congestion with more and bigger roads, and point out the disjunction between the resources we spend on adding road capacity while skimping on maintenance for roads that already exist.

New knowledge

1. Researchers from Harvard and UC-Davis found a connection between air pollution and violent crime in Chicago by correlating incidents of crime on either side of major highways by which way the wind was blowing that day. They find that downwind areas—the ones receiving more highway-related pollution—saw 2.2 percent more violent crimes. While that may be a small (but statistically significant) effect, they’re also measuring small differences in pollution, suggesting that larger, more consistently elevated levels of pollution may have more substantial effects.

3. A new study out of the University of Minnesota’s Institute on Metropolitan Opportunity finds that while there are some areas of the Twin Cities experiencing declining affordability and reductions in poverty, they’re in parts of town with already above-average incomes and housing prices. In contrast, lower-income areas that are often described in local media as gentrifying are mostly exhibiting “signs of decline,” including falling average incomes. Rather than gentrification, the study concludes that “a much greater danger is a growing gap between struggling and prosperous neighborhoods.”

The Week Observed is City Observatory’s weekly newsletter. Every Friday, we give you a quick review of the most important articles, blog posts, and scholarly research on American cities.

Our goal is to help you keep up with—and participate in—the ongoing debate about how to create prosperous, equitable, and livable cities, without having to wade through the hundreds of thousands of words produced on the subject every week by yourself.

If you have ideas for making The Week Observed better, we’d love to hear them! Let us know at jcortright@cityobservatory.org, dkhertz@cityobservatory.org, or on Twitter at @cityobs.